EUR/USD 1.16763
0.028%
Gold 4672.63
0.301%
Oil 80.575
-0.130%
USD/JPY 159.195
-0.004%
GBP/USD 1.36492
0.016%
GBP/JPY 217.296
0.018%
Browse More
  • English
  • 简体中文
  • 繁體中文
  • Tiếng Việt
  • ไทย
  • Indonesia
Subscribe
Real-time News
August 26 – According to the Wall Street Journal, a U.S. government official stated that Trump has submitted a landmark Saudi civilian nuclear agreement to Congress for consideration, but has not abandoned his last-minute demand that Saudi Arabia normalize relations with Israel. This move is expected to spark months of heated debate among lawmakers on how to promote the development of the U.S. nuclear industry while curbing the proliferation of weapons of mass destruction in the Middle East. Last month, when announcing the 30-year agreement, Trump administration officials stated that it would allow U.S. companies to play a central role in Saudi Arabias nuclear infrastructure development while excluding foreign competition. However, the agreement has been controversial because it could open the door to uranium enrichment activities on Saudi Arabian soil.A Reuters poll on August 26th showed that most economists believe the Bank of Japan (BOJ) will act sooner than previously expected, raising interest rates again in September, and the final rate level may be even higher. The survey found that 57% of economists expect the BOJ to raise rates next month, a significant increase from just 5% in July. A smaller minority (10 out of 58) expect the central bank to raise rates again in October or December, bringing the rate to 1.5%. Ayako Fujita, chief economist for Japan at JPMorgan Chase, said, "Since the market has largely priced in a September rate hike, delaying it would likely cause market turmoil, making an earlier policy adjustment inevitable." Looking beyond this year, nearly two-thirds of analysts (35 out of 54) expect the policy rate to reach at least 1.5% by the end of March next year, three months earlier than predicted in the July survey. About 60% of analysts expect the rate to reach at least 1.75% by the end of the third quarter of 2027. Furthermore, regarding the recent rare joint foreign exchange intervention by the US and Japan, more than two-thirds of the respondents (18 out of 26) said that the measures were "not very effective" or "completely ineffective." Many people believe that these measures only delayed the problem rather than truly solving the fundamental issue.US officials: US President Trump still believes that the nuclear agreement with Saudi Arabia can only move forward if Saudi Arabia joins the Abraham Accords and recognizes Israel.August 26th - Minutes from the Federal Reserves discount rate meeting released Wednesday morning showed that four of the 12 regional Federal Reserve boards voted in favor of raising the interest rate charged on emergency loans to commercial banks days before the Feds July meeting. The Feds FOMC decided to keep the policy rate unchanged by a 9-3 vote at its July 28-29 meeting, and these recommendations further highlight the internal controversy surrounding this decision. The boards of the Dallas, Cleveland, and Minneapolis Federal Reserve Banks, as well as the Kansas City Federal Reserve Bank, voted to raise the primary lending rate by 25 basis points. The presidents of the first three regional Fed banks all voted against keeping rates unchanged at the July policy meeting, while Kansas City Fed President Schmid has no voting rights this year. Regional Fed directors are not monetary policy decision-makers and do not determine the Feds interest rates, but they meet regularly with their respective regional Fed presidents. Regional Fed presidents stated that the directors views help shape their own economic and policy outlook. The regional Federal Reserve boards vote on the discount rate at their regular meetings, but the rate is ultimately set by the Federal Reserve Board of Governors to align with the upper limit of the target range for the policy rate. Since December of last year, the target range for the Federal Reserve policy rate has remained between 3.5% and 3.75%.A Reuters poll found that 89% of economists believe Japanese Prime Minister Sanae Takaichis fiscal policies have put downward pressure on the yen.

EUR/USD Accurately Reflects Pre-Fed Anxiety Below 1.0800, Per Lagarde Of The ECB

Daniel Rogers

Mar 22, 2023 14:52

EUR:USD.png 

 

Following a four-day uptrend, EUR/USD fluctuates between 1.0760 and 1.0770 on the day of the Federal Reserve (Fed) decision as supporters halt at the highest levels in five weeks. The Euro-U.S. dollar exchange rate reflects the market's caution ahead of key catalysts, as well as traders' indecision in the aftermath of the recent upswing in sentiment and Treasury bond yields, as well as hawkish central bank bias.

 

Following several days of risk aversion, global markets exhaled a murmur of relief on Tuesday as the market accepted US policymakers' efforts to contain the banking crisis.

 

As one of the most significant developments, Treasury Secretary Janet Yellen's statement that "Treasury, Fed, and FDIC actions reduced the risk of additional bank failures that would have imposed losses on the deposit insurance fund" garnered significant attention.  Bloomberg reported earlier on Tuesday that "US officials are examining ways to temporarily expand Federal Deposit Insurance Corporation (FDIC) coverage to all deposits, a move sought by a coalition of banks arguing it is necessary to prevent a potential financial crisis."

 

Not only US policymakers, but also ECB policymaker Martins Kazaks and Switzerland's Banking Association Chairman, Dr. Marcel Rohner, attempted to convince the markets that their respective banking systems are not imminently in danger of collapsing.

 

Recently, the news that US policymakers are considering methods to circumvent the US Congress in order to protect the banks coincided with speculations that the First Republic Bank is seeking government assistance in order to encourage EUR/USD traders to purchase the currency pair.

 

Contradictory data from Europe and the United States challenges pair traders at the beginning of the most important trading day.

 

Tuesday, Germany's ZEW Economic Sentiment Index decreased to 13.0 for March from 28.1 in February, compared to the market's expectation of 16.4, while the Current Situation index came in at -46.5 for the month, versus -45.1 previously and -45.8 analysts' expectations. Notable is the fact that the ZEW Economic Sentiment Index for the Eurozone dropped to 10.0 in March from 29.7 in the previous reading and market expectations of 23.2.

 

In contrast, US Existing Home Sales increased by 14.5% in February, compared to the 0.0% expected and the -0.7% recorded previously. However, the Philadelphia Fed Non-Manufacturing Business Outlook survey index dropped to -12.8 in March, dampening subsequent US Dollar-related optimism.

 

S&P 500 Futures remain lackluster despite Wall Street's optimistic close, and benchmark US Treasury bond yields struggle to extend a two-day rebound from the lowest levels since September 2022. The yields on 10-year and 2-year US Treasury bonds fluctuate around 3.60 percent and 4.18 percent, respectively, as of press time.

 

Ahead of the crucial Federal Open Market Committee (FOMC) monetary policy meeting, Christine Lagarde's comments could provide EUR/USD traders with amusement.

 

Noting that a 0.25 basis point rate hike is almost certain, EUR/USD skeptics should keep an eye out for hawkish developments in the dot plot and remarks to defer banking turmoil in Fed Chair Jerome Powell's speech.


Suggestion